Virgin Media today urged BSkyB to enter into arbitration talks in a bid to prevent Sky’s basic channels being pulled from its service.
If the two broadcasters fail to reach an agreement over a new contract for the channels by midnight, Virgin Media customers will see Sky One, Two, Sky News and Sky Sports News removed from their service.
Virgin Media said that while this would result in a short term impact on customer churn - the numbers of customers defecting from the service - it expected this to be offset by demand for its video-on-demand service in the longer term.
Chief executive Steve Burch said: "I think the impact will be fairly minimal. Sky are asking us to pay double for channels that are declining in value to our customer base."
He said the savings from the loss of the Sky contract would be ploughed back into improving the content and deal for customers.
Virgin said it had refused Sky’s contract renewal offer as prices escalated amid a declining viewing share, in what it termed an "abusive and anti-competitive" move from BSkyB.
Mr Burch said he believed Sky had "engineered" the withdrawal of its basic channels from the Virgin Media service from the beginning of the talks.
A BSkyB spokesman reiterated that Sky was committed to keeping its channels on cable, which was why it kept encouraging Virgin to come back to the table.
